Common Agricultural Policy Health Check

– in the Scottish Parliament at 2:35 pm on 21st January 2009.

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Photo of Alex Fergusson Alex Fergusson None 2:35 pm, 21st January 2009

The next item of business is a debate on motion S3M-3250, in the name of Richard Lochhead, on the common agricultural policy health check.

While people are changing places, I remind members that the Presiding Officers are no longer giving one-minute warnings as members approach the end of their speeches. We have no free time at all in the debate, which is already oversubscribed, so I must ask members to conclude within the time that is allocated to them.

Photo of Richard Lochhead Richard Lochhead Scottish National Party 3:04 pm, 21st January 2009

I am delighted to open the debate on the common agricultural policy health check. When Parliament last discussed the CAP, few of us would have realised that the next time we would discuss the issue, we would do so against a backdrop of such economic uncertainty. Agriculture and the food industry in Scotland are by no means immune from the effects of that uncertainty—just yesterday we heard of more job losses in our food sector. Despite these turbulent times, some current market trends are good for farming and, as one paper put it just a couple of weeks ago, this is the "Best Opportunity for Farming in a Decade". After all, we will always need food.

Livestock farming remains our dominant form of agriculture, accounting for almost a quarter of agricultural production. Scottish beef and sheep producers are benefiting from a combination of a favourable exchange rate, high prices and falling input costs. Prime cattle prices are about 23 per cent better than they were last year and prices for young sheep are almost 40 per cent higher than they were at this time last year. That general price trend seems to be holding up right across Scotland.

Even with last summer's weather, the final estimate for the 2008 cereal harvest shows a 12.4 per cent increase in prices on 2007. That alone means an extra £34 million for wheat producers and an extra £20 million for barley producers.

The state of the exchange rate resulted in a windfall of an extra £50 million in Scottish single farm payments. We have also helped to ease producers' cash flows in the current challenging times by issuing this year's single farm payments and less favoured area support scheme payments in record time: 96 per cent of single farm payments have been made to around 19,000 producers, which means that about £430 million has already been deposited in farm business accounts, while LFASS payments started to appear in bank accounts on 16 January—more than three weeks earlier than was the case last year.

We support farming because the sector benefits Scotland enormously by shaping our environment and attracting tourists to our landscapes. Livestock farming is particularly important to food production, but we need critical mass if we are to maintain the wider infrastructure in our rural areas.

Photo of Alasdair Allan Alasdair Allan Scottish National Party

The cabinet secretary mentions the importance of our landscape. One reason why it is in the form that it is in is that it is grazed. Does he intend to make any further response to the representations from many crofters about the future of bull hire in Scotland?

Photo of Richard Lochhead Richard Lochhead Scottish National Party

We will respond further on that. I assure Alasdair Allan and other members who represent constituencies in the Highlands and Islands that we are committed to supporting our crofting communities and that we are working hard to replace the current bull hire scheme—which does not provide value for money—with successor arrangements. I would be delighted to have my colleague Michael Russell, who is taking a close interest in the issue, contact interested members with more details over the next few days.

Quality food that is produced in Scotland often commands a market premium. Producers need to continue to deliver products that fit niche markets, as we simply do not have the capacity to compete in major commodity markets. Scottish production benefits from an emphasis on quality rather than just quantity. It is that quality that has earned Scotland a reputation throughout the world for food and drink that bring economic benefits to the tune of £410 million for Scottish food exports and £3.3 billion for Scottish spirits exports. The spirits industry is, of course, underpinned by raw materials that are produced by agriculture in Scotland.

Over the festive period, Scots certainly enjoyed local produce. The Scotch Butchers Club reported increased meat sales, which in one case went up by more than 20 per cent. However, producers must not take their eye off the ball. There is a constant need to monitor the market and to adjust production to meet consumer needs. That is why the Scotland rural development programme funds schemes such as the skills development scheme and whole-farm reviews, which help farmers to develop their businesses and make the most of their assets. In addition, there are monitor farms, which are a great example of the industry helping itself through group discussions and sharing of information. Recent analysis shows that every £1 that was spent in a monitor farm resulted in a return of £6.50 in increased productivity and improved efficiency.

Just like many other sectors, farming needs to adapt and evolve to respond to the market. Farmers continue to face significant challenges, which some people say are all the greater because the CAP has failed to modernise quickly enough by moving from production-based to market-oriented support. Although the decline in livestock production on our hills is perhaps an inevitable result of the decoupling of support from production, it is nevertheless a cause for concern among all members.

2009 will be an extremely important year. There are major policy decisions to make on the key resources that can help agriculture to meet the challenges ahead: the CAP, the LFASS and the SRDP. When times are hard and resources tight, it becomes even more important to be absolutely certain that we use the considerable sums that are already available to achieve the best possible outcomes for rural Scotland.

As far as the CAP is concerned, even though the health check was not a major reform, it represented a good deal for Scotland—we achieved our key objectives and did not cross any of our red lines. In particular, we secured flexibility over the Scottish beef calf scheme and secured the right to continue the scheme; we made the playing field more level right across Europe and we ensured that any changes from the health check did not disrupt our options here in Scotland. As NFU Scotland said, the health check agreement is

"a positive way forward for Scotland's farming industry".

The primary legislation has been finalised, but we need to wait for the European Commission to publish detailed implementation rules. However, we must start to consider how to use our hard-won flexibilities. We will need to make several key decisions in partnership with the industry. In each case, the conflicting priorities will need to be weighed up to ensure that a solution is found that meets Scottish needs.

The decision on article 68, which funds the Scottish beef calf scheme, will be crucial as it could offer a means to maintain livestock numbers. Any form of top-slicing creates losers as well as winners—it would be foolish for any of us in the chamber to ignore that. I hope that our debate today will help to inform the debate about the balance of advantages. With stakeholders, we will consider whether the scheme should continue and, if so, in what form. We must be clear about the outputs that we want to achieve, and we must ensure that the industry can deliver what the people of Scotland want.

The SRDP is providing social, economic and environmental benefits across Scotland. However, given the current economic climate, I have said that I am committed to a swift but thorough review of the SRDP to consider whether changes are needed so that we can be certain that the programme's priorities are fit for purpose in 2009 and beyond. I will be discussing the details of the review when I meet the programme's monitoring committee next week. We will learn the lessons that have to be learned from the first year of operation of the SRDP. Let us not forget that the SRDP is hugely valuable for Scotland—the rural priorities scheme alone has approved nearly £60 million-worth of projects before the first full year of the programme is complete.

Looking to the future, it is imperative that we give our farmers clarity on the direction of travel and on the timing of any changes. Any changes that we make now must be in tune with our longer-term vision for agriculture in Scotland. At the recent Oxford farming conference, I set out my vision for Scottish agriculture. The Scottish Government is developing a clear vision for Scottish agriculture that reflects Scotland's distinctive characteristics and needs. We want a vision that involves on-going direct support for farming.

It is sometimes hard for people who are not linked with farming to understand why Government support is still necessary. However, the Scottish Government simply does not buy into the United Kingdom policy of removing direct CAP support for farming and food production in Scotland. Removing direct support would halt farming in many parts of Scotland. We believe that food production and the capacity to produce food are in the national interest and should be supported as long as that is necessary.

The vision of the Department for Environment, Food and Rural Affairs seems a long way from the multifunctional type of agriculture that is described in the European model for agriculture, which has the support of much of Europe. Scotland can be proud to count itself in with the majority view rather than the minority UK view.

My firm view is that what we need is, in effect, a new updated contract between farmers and society, through which our Scottish vision can be delivered. The contract should be clear about the outcomes that are expected in return for direct financial support. It should recognise the importance of food production but it should also require delivery of other public goods. The contract should deliver a Scottish agricultural industry that produces for the market, whether that means the food or energy markets or other markets such as tourism—an industry that gains recognition for the public goods that it provides, whether economic, social or environmental, and that is appropriately regulated, rather than overregulated. We could call that a vision based on natural resource productivity that ensures that Scotland makes the best use of a very valuable resource—our land.

We must also consider the basis of future single farm payments. It is clear to me that the historical model for the SFP is increasingly untenable, especially given the understandable calls for greater linkage with activity. I believe that stakeholders agree with me, and I want to address these difficult choices sooner rather than later. Some people argue for support to be focused on the most productive farming, but others suggest that those areas already get too much support and that future support should be targeted at remote and fragile areas where the challenges and the need are greatest.

The health check broadened out the options for starting to move towards a flatter rate for single farm payments. Industry's input will be crucial as we consider what approach will be best for Scotland as we face up to challenges and try to avoid unintended consequences.

The health check focused on the CAP from now until 2013. There will be discussion in the European Union budget review on the post-2013 direction of the CAP. However, some things are fairly predictable: for example, there is unlikely to be more money for the CAP in the future. In fact, there may be less.

We need to start firming up our options for 2010 onwards. We will need to make tough decisions with stakeholders on how we should use the flexibilities to deliver the farming that Scotland needs. We will also need to think ahead to the post-2013 period. Scottish farming is distinctive because of its land, climate and population, including its remote and fragile areas. Those are things to consider as the Government delivers its vision.

In conclusion, 2009 is a pivotal year for Scottish agriculture. I am very keen to hear Parliament's views on some of the key decisions that we, as a nation, must take. I hope that we can all agree that we must support active farming—farming that produces food for our tables, that safeguards and enhances our spectacular landscapes and natural environment and which continues to sustain our rural economy.

I move,

That the Parliament, noting the recent agreement in the Council of Ministers on the European Commission's legislative proposals for the Health Check of the Common Agricultural Policy (CAP), acknowledges the Scottish Government's commitment to work with stakeholders on how key aspects of the proposals should be implemented in Scotland and on the longer-term implementation of CAP in Scotland and believes that future decisions must reflect the distinctiveness of agriculture in Scotland and support a dynamic and competitive industry with farmers playing their full part in achieving the Scottish Government's purpose of sustainable economic growth through food production and the environmental management of our agricultural land, combined with the delivery of other economic and social public goods.

Photo of Sarah Boyack Sarah Boyack Labour 3:15 pm, 21st January 2009

This is an important debate that comes at a significant time. Although we are not there yet, the process of redesigning support for agriculture and our rural areas has begun. It is a big challenge to get all the states in Europe to sign up to a new system—a better system that is capable of supporting our rural areas through the challenges of tomorrow, not the challenges of the post-war era. In our previous debates on CAP reform, it has been absolutely clear that it is relatively easy to identify key principles but difficult to shift the way in which money is distributed, both at Scottish level and at European level.

We broadly agree with the Scottish Government's motion. Scotland is different from the rest of the United Kingdom—that was one of the founding principles of devolution. We have a tougher climate and areas where farming and crofting are marginal and difficult activities. We also have hills and upland areas where getting the right balance of livestock is important but difficult to achieve. However, there are two areas in which we should not have fundamental differences: we must recognise the importance of globalisation and the need to tackle climate change.

Farmers in developing countries have their hands tied behind their backs. They compete with farmers in countries that have far greater resources, that receive relatively massive subsidies and that are subject to trade barriers. We believe that we need a fairer set of relationships between the developed and developing worlds.

Climate change has also pushed food security issues up the international agenda. We strongly support Hilary Benn's attempts to put food security on the agenda for the G8 and the Copenhagen discussions later this year. His "Bread and Roses" speech before Christmas set out an absolutely clear vision for development of a food security policy that would respect our environment and our global commitments.

As the cabinet secretary himself said earlier this year, the UK line is stronger when Scotland's distinct perspective is fed in. We also have a better chance of a positive outcome for Scotland if we are within the UK negotiating position. However, as we have debated before, if we are thinking about food security, we must think the matter through properly from a Scottish perspective, which is why we strongly support the principle of subsidising agriculture but believe that the current system is unfair and not fit for purpose. We must bring to an end the scandalous situation whereby money is paid out to people who have ceased to farm. We must also continue the shift away from production subsidies to wider farming and rural support.

Our farming and rural support must make clear the public benefits, with more support for environmental stewardship and clear support for higher standards of habitat, biodiversity and animal welfare. We have all followed the concerns about the Farming and Wildlife Advisory Group. I say to the minister that we believe that that group does a good job and that we would like the issue to be properly resolved.

Although we support the SNP motion, it needs to be strengthened—specifically, it should mention the need for new measures to maintain and enhance habitats following the loss of set-aside provisions. We do not see a conflict between that and food production. We accept that set-aside has gone and that something new needs to be introduced to deal with habitat enhancement. We want to ensure that farmers and land managers are paid when they clearly add value through field margins, hedgerows and other forms of active enhancement. Those are public environmental goods that benefit our environment and for which we should pay. Good value for the public purse means ending the historical but out of date payments for land that is no longer farmed or properly managed. We therefore do not have a problem with the Tory amendment, because that is our interpretation of it.

However, in our debate on CAP reform, we must ensure that we do not lose focus on what is happening to our rural and farming communities now. Last week, we had an excellent members' business debate on a motion that was lodged by Jamie McGrigor, in which a great deal of consensus was shown around the chamber. Since then, Rhoda Grant has met European Commission officials to talk through bull hire support. We are absolutely clear that a bull hire scheme is both essential and not against European Union rules, as long as it keeps within the de minimis rules, which is entirely possible.

We have crafted our amendment so as not to tie the minister's hands too firmly. However, I warn him that we will listen carefully to his further comments. We are intrigued by his suggestion to Alasdair Allan that private sources might be acceptable. We want to put on record that we want Government provision of a bull hire scheme for crofters. Experience has shown that merely giving them advice or suggesting that they go to private hire sources does not work; we need something more organised than that.

There are also things that the cabinet secretary needs to do immediately, such as ensuring better support for new farmers and taking urgent action on the rural development plan, which is obviously failing to deliver for specific farming sectors and our rural environment in general. One issue that has been raised in the consultation on the Climate Change (Scotland) Bill is the need for new investment in forestry. However—surprise, surprise—the SRDP, which is the Government's main tool for delivering new planting, is completely failing. It is too bureaucratic and lacks transparency. It is not that there is no demand from the private sector for forestry investment—indeed, previous schemes were oversubscribed—but such investment is not happening through the rural development plan. Action needs to be taken to fix the situation.

We have debated the pig sector before, and have talked about the need to ensure that we do not lose so many sheep and cattle from our hills that the pendulum swings from overgrazing to insufficient grazing, which would be bad for the rural economy and bad for the environment.

The milk industry is in meltdown. Only last week, Jim McLaren made the hugely symbolic announcement that he is considering moving out of dairy farming. That is not a good position for us to be in. The cabinet secretary needs to act now, so I call on him to hold a summit of all of the key players—we are happy to sit around the table with him—and examine ways to ensure fairer and more sustainable prices. We cannot wait until we have no more milk producers in Scotland: the time to act is now, not when they have all gone.

Procurement has to be part of the agenda, as it is one of the ways in which we ensure fair prices and fresh, good quality food produce. I ask the cabinet secretary to update us on his work in that regard.

There must be much wider support for our rural communities. The SRDP is a crucial part of the armoury of the Scottish Government, but it is simply not working. The scheme needs to be completely overhauled sooner rather than later. Only a week or so ago, Rhoda Grant asked for details of the review, but the cabinet secretary said nothing about it today. We want to know what is happening, and when. In a debate on CAP reform, we must consider not only what we are doing now but how it links into future CAP reform issues. We cannot divorce the two issues.

It would also be helpful if, in his summing-up speech, the minister would talk about RSPB Scotland's concerns that he is watering down the Scottish Government's commitment to the importance of environmental benefits as environmental goods. That must be commented on by the minister. The RSPB believes that the minister is stepping back from principles that we have all supported in the past. From talking to colleagues in Brussels and south of the border, I know that they think that the SRDP is having less impact on environmental enhancement policy than it did previously. We need it to do more.

Labour strongly supports change to the CAP. We think that the reform process is a positive one and that, although the Scottish Government and the various stakeholders do not always agree with one other, there are areas of consensus in which we can pull together some key principles. However, the tough issue is for the minister to get the scheme's design right and to act.

I want to put on record the fact that we think that where farmers, crofters and land managers are providing public goods in environmental quality, landscape enhancement, biodiversity and unpolluted water courses, it is absolutely right that they be supported in their stewardship. However, we have to join that agenda to the food security agenda. We must have an integrated approach that deals with the challenge of creating jobs in our rural economies and which takes a joined-up approach to agriculture, landscape management and environmental enhancement. The rural development plan is absolutely vital in that respect, which is why we are keen to hear what the Liberal Democrats have to say in support of their amendment.

We are interested in the points in Robin Harper's amendment, and we support monitoring and control of pesticides. We have concerns, however, about the policy that has been passed in Europe. More needs to be said on that, and we do not think that the Greens' amendment captures the argument entirely.

I move amendment S3M-3250.4, to insert at end:

"and calls on the Scottish Government to work constructively with UK ministers to ensure that the United Kingdom's negotiating strategy delivers the right framework for rural Scotland, including support for farming and crofting in fragile rural areas, to ensure that new policy mechanisms are in place to maintain habitat programmes, following the loss of set-aside provisions, and to continue a bull hire scheme."

Photo of John Scott John Scott Conservative 3:25 pm, 21st January 2009

I declare an interest as a farmer and as a member of NFU Scotland. I welcome this timeous debate on the CAP health check. At this time of year we must reflect on last year, and—more important—we must look to the future.

We believe that the CAP health check has been largely beneficial for Scotland. We welcome the confirmation that milk quotas will end by 2015, which will—notwithstanding the current pricing difficulties—free up our dairy industry. We also welcome the ending of set-aside, which will free up our cereals sector, but we need to find imaginative ways to preserve the environmental gains that have been made on that land over the past two years.

We welcome the freedom for Scotland to decide how best to proceed with the beef calf scheme, and we welcome the move towards a more level European Union playing field in relation to modulation. The threat of cuts in support payments to our largest and most efficient producers has sensibly been resisted, as has—for the time being—a move from the historical rate to flat-rate payments for the single farm payment.

We will support the Labour Party amendment, specifically because we believe that—as Jamie McGrigor has so eloquently pointed out—there must in the future be a bull hire scheme or an equivalent scheme. We have reservations about the Liberal amendment, because it is a bit out of date. We acknowledge that there were serious problems with access to the SRDP, but the situation is now improving. In reality, the situation has moved on—

Photo of John Scott John Scott Conservative

No, thank you.

The Government has committed to a review of the SRDP, so we now need to engage in constructive debate rather than repeat out-of-date criticisms. We will therefore abstain on the Liberal Democrat amendment. We are, regrettably, also unable to support Robin Harper's amendment. [Interruption.] I am sorry, but I cannot take an intervention—I am lacking in time rather than not wishing to do so.

With regard to our own amendment, we must—as the minister said—make certain that future support goes to those who are actively farming or crofting their land. Support payments should no longer be made to those who carry little or no stock, or to those whose land is left lying fallow or uncultivated. Stock levels should at least match the historical levels that existed prior to the introduction of quotas in the 1990s.

Most farmers would be able, by using records such as farm accounts or census figures, to demonstrate the traditional or historical carrying capacity of their land in 1990, for example. That could provide, with sensible variation around the figures, a baseline production figure to return to—or at least to work towards—over, for example, a five-year period. I hope that members will recognise that the thrust of my speech is about returning to maximising food production from our farms and crofts, and doing so as quickly as possible.

Almost 15 months ago, I gave a speech at Ingliston to the National Sheep Association, in which I urged sheep farmers not to go out of production because I believed that there was a bright future for lamb and mutton production. Today, that prediction is coming to pass, and there are better returns from the marketplace. It breaks my heart to note how many farmers and livestock producers have gone out of business in the past 18 months, at the very time when the market was turning and about to become more profitable. That has come about because—notwithstanding the financial crisis that has rightly grabbed the headlines in the past year—self-sufficiency in food production in the United Kingdom has fallen from 78 per cent to 57 per cent in the past 12 years and prices are beginning to rise as food commodity shortages materialise.

The UK economy, which that is overly dependent on selling financial services, has ignored the fact that we have lost much of our energy, manufacturing and food-producing capability. Those trends already threaten our national security. We in Scotland can do something about our reduced food-producing capability, particularly in relation to the matter of today's debate. I urge the minister to take steps to address the strategic shortfall about which he spoke so eloquently at the Oxford farming conference.

Scottish Conservatives believe that in the national interest, the Government must reprioritise the objectives of the SRDP to return to food production while—if possible—protecting recent environmental gains. Until recent times, the first public benefit from land was food production. We must return to that concept, as we cannot afford to lose any more farmers and crofters from our fields and farms.

The wake-up call has been the three major reports over the summer from the Royal Society of Edinburgh, the Scottish Agricultural College and NFU Scotland. It is time for the Scottish Government, the UK Government and the EU to wake up and smell the coffee and once again to focus on food production. Here in Scotland, we must stop families leaving the land, because history has shown that when that happens they never return and the animal husbandry and countryside skills base, which has been acquired through generations of toil and passed from one generation to the next, is lost for ever. Stopping families and their stock leaving their farms and crofts can and will only be achieved by returning food production to profitability. In my view, food scarcity will eventually restore food production to profitability; indeed, that is already happening.

In the meantime, our Government must refocus the SRDP on sustaining families and our food-producing land, because without farming and crofting families on the land we can have neither food production nor environmental enhancement. I welcome the minister's positives comments on that earlier today. Now is the time to refocus the SRDP in that way. I call on the Government to do that before it is too late and we lose still more of our food-producing capability from Scotland.

I urge members to support my amendment. I move amendment S3M-3250.1, to insert at end:

"considers that greater levels of food production and increased self-sufficiency are becoming increasingly important, and therefore encourages policy makers to work towards future support being linked to the active farming of land."

Photo of Liam McArthur Liam McArthur Liberal Democrat 3:31 pm, 21st January 2009

When the cabinet secretary emerged, blinking into the light after lengthy negotiations on the CAP health check, he proclaimed to have secured

"a European farming policy that supports sustainable production rather than over-production".

He added that

"in that context the CAP Health Check moves in the right direction".

I readily acknowledge that the outcome of the talks that concluded in November was, on the whole, fair. The UK negotiating team secured valuable concessions, not least in the flexibility in how the measures were to be implemented, but I struggle to see how the cabinet secretary can claim that what was agreed moves away from the perils of overproduction. Given the current debate about food production and food security, which John Scott mentioned, most farmers and crofters in Scotland will consider Mr Lochhead's claim to be a strange one.

Nevertheless, I welcome many aspects of what was agreed in November. For example, retention of the beef calf scheme is helpful. It has perhaps not been as effective as we would have wished in keeping cattle on the land, but without it the situation would almost certainly have been far worse. There has, of course, been a debate about whether and how it could be augmented, but I have my doubts that top-slicing moneys across farming would be effective enough to justify the inevitable pain that it would cause.

As someone who was involved in the introduction of the beef envelope back in 2005, I was interested to note the industry's hearty welcome of the scheme's retention in 2008. That perhaps confirms that the beef calf scheme has come some way since its difficult birth.

On modulation too, I believe that the compromise that has been reached at this midway point between major reforms of the CAP is a sensible one.

Members are, of course, aware of the relative paucity of the resources that are available for rural development initiatives in Scotland. That issue was never going to be addressed in the CAP health check, but I hope that, as part of the joint working that is called for in Sarah Boyack's amendment, it could be identified as a priority for the negotiations over what happens in 2013 and beyond.

I have little difficulty with most of what was agreed during the health check, aside from some of the now-customary ministerial hyperbole. However, there are serious issues that require urgent attention if we are to secure the dynamic and competitive industry to which the Government's motion refers.

John Scott is right in his amendment to point to the importance of both food production and self-sufficiency. The cabinet secretary highlighted the fact that, given that Scotland is a major exporter of high-quality beef and lamb as well as fish and other food and drink products, we must be careful how we conduct the debate about self-sufficiency. However, the appetite among consumers for more local produce is tangible, it is growing and it presents real opportunities for our farming community and food businesses. The need to look at how support can be linked to active farming of land will also be important as part of this process and as a response to the dramatic reduction in livestock numbers on our hills and in our remote areas.

I accept that the historical basis of payments has always had a shelf life and that ways need to be found to ensure that the public continues to get value for money from the support that is provided. That said, calls for an abrupt switch to area-based payments are premature. Along with retention of a bull hire scheme, those are important issues that must be addressed if we are to safeguard the distinctiveness of agriculture in Scotland.

The Scottish Liberal Democrat amendment highlights serious failings in the operation of the Scottish rural development programme. In particular, the rural priorities scheme has proved to be, in the words of Dan Buglass of The Scotsman, "a bureaucratic morass." The scheme is worth up to £800 million to farmers and small businesses over the next four years and there seems to be little dispute anywhere, from anyone, that it is not working well. As a consequence, farm business viability, as well as our biodiversity and environment, risk being compromised.

Having chastised ministers for using hyperbole, I will try to avoid making the mistake of using it. However, even the minister has acknowledged—rather coyly, perhaps—the existence of

"teething problems and bureaucratic issues".

The president of the Scottish Beef Cattle Association, John Cameron, put things rather more bluntly. He described the situation as a "nightmare".

Part of the problem, of course, is the insistence by ministers that all applications be made online. That stipulation poses no problem for many people—indeed, it has many attractions—but it has created enormous difficulties, extra costs and frustration for many other people who are without a computer or access to high-speed broadband. We welcome the fact that a review of the scheme's operation is under way and that it is to be wide ranging, but the problems relating to online applications, for example, were flagged up loudly and early. They can hardly have come as a surprise to ministers.

Of course, Mr Lochhead has insisted that a review was always planned. However, what was not planned was the minister's meeting with the NFUS's less favoured areas committee before Christmas, at which he was left in no doubt about the scale of the problems or the anger that exists. A Press and Journal report at the time suggested that Mr Lochhead

"is understood to be deeply concerned at poor acceptance rates".

Nevertheless, the Government still appears to be in a state of denial. Ministers have talked about 3,000 applications resulting in more than £480 million of spending so far. Dan Buglass called that

"smoke and mirrors from the SNP".

Some £300 million of that total was made up of legacy schemes that were inherited from previous years, and there is the £120 million in less favoured area support for 2007 and 2008. The cabinet secretary has accepted that just £60 million has been committed this year. I am pleased that he now acknowledges that problems exist. I hope that he accepts the scale of those problems, and I hope that his review will be swift, thorough and wide-ranging, as he says it will be. It is also important that Parliament be provided with an early opportunity to consider his proposed changes.

I will leave the final word to a north-east farmer, who has been at the sharp end. He was quoted in The Scotsman as saying:

"Mess is an understatement, the whole system is unworkable and over complex. It is constantly altered and rules changed without informing applicants. I have given up trying to do it myself and now have three yes three separate advisor's working on applications ... The whole scheme has effectively ceased to function".

I have pleasure in moving amendment S3M-3250.3, to insert at end:

"notes with concern evidence of serious difficulties experienced by farmers and crofters in accessing monies under the Scotland Rural Development Programme (SRDP); recognises the Scottish Government's commitment to review the Rural Priorities scheme, and calls on the Scottish Government to ensure that the review is sufficiently wide-ranging to cover all aspects of the structure of the SRDP as well as the application process for payments to resolve urgently the problems with the operation and implementation of the programme."

Photo of Robin Harper Robin Harper Green 3:37 pm, 21st January 2009

The Green amendment is not intended to take away from the spirit or the principle of the Government's motion; rather, it is intended to add an important dimension to the debate.

The vote on the pesticides regulation in the European Parliament last week marked an important milestone in public health and environmental protection. Rather than bowing their heads to the scaremongering of the chemical industry and certain quarters of the agricultural industry that preceded the debate, MEPs voted overwhelmingly in favour of giving greater protection from toxic pesticides. UK MEPs—SNP, Lib Dem, Tory and Labour—were among the very few to oppose even the limited measures in the legislation. That made Britain virtually isolated from the rest of Europe. The rest of the European Parliament has had the courage to support phasing out highly hazardous pesticides and putting human health and the environment ahead of the pesticides lobby. If the proposal is implemented in full, people elsewhere in Europe will have protected their children and hospital patients and our collective health.

Let us not forget the importance of protecting the environment and the public from the worst of the pesticides. Only around 22 chemicals of the 311 licensed pesticides that are available to farmers have been listed in the legislation, as they have been deemed harmful to human health. They can cause cancer, harm human reproduction and disrupt hormone systems. From that perspective, it is unnerving that so many UK MEPs could not vote for the legislation.

The regulation is not hugely radical. It tackles only the worst of the worst of the chemicals and does not even ban their use with immediate effect—in Europeanspeak, "immediate effect" means five years. The industry will be given years to phase them out, which allows it time to innovate and reformulate its products. We could have gone further.

Of course, we already know that safer alternatives exist. Organic farmers are producing good yields and safe, quality crops without using many of those chemicals—in fact, organic farmers use only seven of them, and they do so only in special circumstances. Contrary to the claims of some farmers, organic farms prove that good crops can be grown with minimal or no use of pesticides. Those good crops and yields rely on the latest non-chemical methods of plant protection and pest and crop management.

Further, the regulation recognises the importance of bees to pollination and the problem of their dwindling numbers, an issue to which I and many other people have already alerted the Government. I draw the Government's attention to the important research that is being done at the University of Stirling on bumble-bees, which needs as much support as it can get. From now on, pesticides must be proven to have no unacceptable acute or chronic effect on bees if they are to be introduced or allowed to stay on in the market. That is a thoroughly welcome addition to the regulation. The subject may seem touchy-feely to some, but our agriculture industry and the survival of many of our crops are absolutely dependent on a thriving and healthy bee population. The ban is therefore good, not bad, news for farmers.

The new rules will also ban or severely restrict any use of pesticides near schools, parks, sports and recreation grounds and hospitals and health care facilities. Aerial crop spraying in general will also be banned. Mandatory buffer zones will apply to protect aquatic environments and drinking water from pesticides. Again, those are sensible measures for the protection of human health. I acknowledge that most of them were agreed to by all our MEPs when they voted on the directive that preceded the regulation.

People should have no need to be concerned about toxins in their food or the effect that crop-spraying may have on their or their children's health. Parliamentarians and Governments should have no qualms about putting the interests of human health first or acting in the public interest to promote a safe and sustainable food supply. Even some retailers, such as the Co-op and Marks and Spencer have decided to move ahead on the issue in the public interest. When those retailers cannot be sure that a pesticide is safe, they ban its use on the food that they sell.

MEPs from the other parties that are represented in the Scottish Parliament appear to have gone native with the chemical lobby, but I nevertheless hope that MSPs will accept my amendment or at least indicate some sympathy with what it says, as Sarah Boyack did. The principle that lies at its core is that of higher standards for the protection of human health and the environment.

I move amendment S3M-3250.2, to leave out from second "the Scottish Government's" to end and insert:

"Scotland's environmental, social and economic priorities through food production and the environmental management of our agricultural land, combined with the delivery of other economic and social public goods; accepts the decision by an overwhelming majority of the European Parliament that new controls need to be placed on the use of agricultural chemicals; notes that once these new controls are implemented there will be a level playing field in Europe, allowing the competitiveness of Scottish agriculture to be maintained, and further notes that environmental security and sustainability will be key to delivering a competitive and dynamic agricultural industry in the future."

Photo of Trish Godman Trish Godman Labour

We move to the open debate, in which there will be speeches of six minutes. There will be no warning for members when they have only one minute remaining, so they should keep their eye on the clock, because we are very tight for time and, once a member's time is up, I will immediately move to the next member so that I can get everybody in.

Photo of Rob Gibson Rob Gibson Scottish National Party 3:43 pm, 21st January 2009

I draw members' attention to my entry in the register of members' interests, which shows that I am a member of the Scottish Crofting Foundation.

I welcome the opportunity to describe the health check on the CAP as being of value to Scotland. We are moving to a stage at which we are being listened to a good deal more. I welcome the effect that the cabinet secretary has had in the debates that have taken place with the British representatives. I believe that we have gained more in those debates than we did previously. However, I am concerned that the British representatives at the top table do not always listen to us. In support of that view, I note that, in The Press and Journal on 12 January, the European director general for agriculture and rural development, Jean-Luc Demarty, expressed his concern that the UK Government is

"continuing to call for further Common Agricultural Policy reforms and possibly using new measures" to curb farm production.

As John Scott mentioned, the UK is about 57 per cent self-sufficient in food. A rise in food prices is good for our farmers but, for people in the bulk of the world, it is very bad news. However, we are not selling to places that cannot afford it; we are selling to other rich parts of the European Union. It was interesting that the European Parliament adopted a resolution on global food security that strongly affirms the importance of the common agricultural policy

"as the means to secure food production in the EU" and globally, despite long-standing criticisms of the policy's effects on farmers in the developing world.

The Labour Party should come clean about whether we are to continue to demand cheap food imported by air and other climate-busting means from farmers in developing countries in Africa and elsewhere. A balance has to be struck in the British mind between allowing a free market and protecting our interests to grow what we can here. Food security is central to what Scotland's contribution can be not just to Britain but to other parts of the world. We have to set that example in debates on how the common agricultural policy is working now and on what will succeed it. There has to be continued support for European farming, as our colleagues in the European Parliament said. That model of farming would allow Scotland to be on a par with other countries in Europe, perhaps to a greater extent than the British Government thinks should be the case.

I am interested in the Labour Party's interpretation of our co-operation with London and in the Tories' ideas that Labour will adopt their wishes for food security. That would be an interesting debate. However, there is room for us to come together.

Members should be careful about criticising the SRDP in the health check. We should remember that the Government came to power after much of the process was complete. In order to get the system up and running, it had to agree to a scheme that it did not design. When Liberal and Labour members raise questions about how the process is working and the online issues, they have to take responsibility for setting it up.

Photo of Rob Gibson Rob Gibson Scottish National Party

Not at the moment, thank you; I have to move on. I am sure that we will hear more about the SRDP from other Liberal speakers. We will wait for that, but now I want to talk about other things.

There is too much theology rather than sound science in the pesticides debate. Robin Harper suggested when speaking to the Green amendment that organic farmers use very few pesticides, but the science is unclear about a good number of pesticides. I have lodged questions today about some of them, as others have done in the past. We need clarity about which pesticides damage bees, invertebrates and so on. I am delighted that the Government has set out its invertebrate strategy—perhaps we can bring some of the science up to date. Robin Harper mentioned that the University of Stirling is doing research on the matter, which underlines that we do not know the full facts at the moment.

I have lodged a motion on conventional plant breeding, which might help us to remove some of the pesticides and other harmful chemicals that are used on land. I hope that members throughout the chamber will support it.

The debate on the bull hire scheme was passionate. We know that the current system does not work, and there were proposals from places such as Orkney for a scheme to help crofters there and assist our major beef industry. However, what the cabinet secretary said today assures us that we can help crofters in those difficult areas through a scheme that meets their needs.

Photo of Elaine Murray Elaine Murray Labour 3:49 pm, 21st January 2009

The Government motion refers to the distinctive nature of Scottish agriculture and our amendment also refers to the need to support farming and crofting in fragile, rural areas. Although this is essentially a consensual debate, we need to address the fact, to which Rob Gibson alluded, that back in 2005 in the Treasury/DEFRA paper "A Vision for a Common Agricultural Policy" there was a statement on ending all pillar 1 support for agriculture. That document argued for the removal of direct payments by the second half of the next decade and for EU spending on agriculture thereafter being supported through pillar 2.

Many argue for the removal of direct subsidies during the next EU financial cycle, not least to make the EU more compliant with the demands of the World Trade Organization. The EU has been asked to cut its trade-distorting subsidies, to reduce its import tariffs and to end its export subsidies. Trade distortions hit poor farmers in the developing world hardest and are incompatible with the principles of fair trade.

Statistics from the Organisation for Economic Co-operation and Development suggest that subsidies to farmers in OECD countries amount to more than the whole of Africa's gross domestic product. Rob Gibson talked about EU issues but, to an extent, the debate is about how, at times, protectionism in the wealthier part of the world disadvantages people in poorer countries. Issues of global fairness need to be tackled. As John Scott and Sarah Boyack said, food security needs to be at the top of national and international agendas.

On the other side of the argument, the distinctive situation in Scotland must be recognised. A high proportion of our agricultural land—85 per cent—is designated as less favoured areas. The total removal of pillar 1 support from those areas could cause farming to cease in some of them. That would be disastrous for farming, for the economy and for food security.

At the Oxford farming conference earlier this month, Hilary Benn said:

"Farming and farmers we should cherish and celebrate as the greatest resource we have as we face the future."

I am sure that that statement has cross-party support.

Nevertheless, some Scottish voices call for direct support to be abolished. In "Beyond the CAP: Towards a Sustainable Land Use Policy that works for Scotland", Scottish Environment LINK argues that direct subsidies should be abolished and redistributed on the basis of the provision of public good. Of course, the public good is a woolly concept that is open to different interpretations.

Like the Royal Society of Edinburgh's report on the future of Scotland's hills and islands, Scottish Environment LINK's paper makes the important point that, as we know, funding distribution throughout Europe significantly disadvantages Scotland, for historical reasons. That is particularly true of the pillar 2 rural development support programme. If we are considering changes to support, we must consider how to tackle Scotland's historical disadvantage.

The opportunity exists for different sides of the debate to reach agreement, because Scottish Environment LINK says:

"total reform should not happen immediately."

The aim should be to make progress towards a sustainable land use policy.

Public subsidy should be directed to public benefit. Local food production is a public benefit, so it deserves public subsidy. If removing direct support in Scotland would cause local food production to cease, it should not be removed. However, that does not mean that we should not be determined to make progress towards a more holistic view of how land is used and how the public benefit from it. That will probably be accompanied by changes to support for the activities that deliver public benefit.

Land use strategy is essential to many of the important issues that we are discussing. For example, we will debate the Flood Risk Management (Scotland) Bill at stage 1 tomorrow. An important facet of that is sustainable flood risk management and using natural processes such as flood plains to combat climate change and prevent flooding. Such measures will require decisions about the use of land for public benefit. For example, the public benefit of food production could be set against the public benefit of using land to prevent floods. Some such decisions will be difficult to make.

In the coming months, we will continue to discuss the role of forestry in combating climate change and the opportunities to increase woodland cover as part of our strategy to increase carbon sequestration. I will not rehearse the contentious issues, but decisions will have to be made about the public benefit of the different purposes of land use. I hope that ways will be found to bring together those three issues, such as by supporting landowners to establish woodland on flood plains.

Half of Scotland is covered by peatlands, which play a tremendously important role in locking up carbon. Supporting and reinstating peatland are an important way of using land in Scotland to public benefit.

Much progress was made during the CAP health check. Many new measures were added, such as those to counteract the possible deleterious effects on biodiversity of ending set-aside. We are asking Scottish ministers to work with their UK counterparts on issues such as cross-compliance. They also need to discuss the fact that set-aside was funded through pillar 1, as part of direct support, whereas funding of environmental benefit is being done through pillar 2. Such issues need to be discussed more fully.

Photo of Dave Thompson Dave Thompson Scottish National Party 3:55 pm, 21st January 2009

I am pleased that we are debating the subject so early in the new year. The debate comes at the start of our Burns season, when high-quality food and drink are so important. Having the debate so early in the year highlights the fact that agriculture is central to our culture and economy. Indeed, part of the cultural celebration of homecoming this year is the world-class food and drink that are produced throughout Scotland, which give us our character and truly set us apart.

I attended a dinner the other night to mark the opening, by Jim Mather, of the fantastic centre for health science in Inverness. I happened to sit beside a man from Barcelona who now works in Inverness—no, it was not Manuel from Fawlty Towers, but a well-travelled and well-educated executive. After the meal, the centre laid on a special tasting of the Balvenie signature whisky. I am sure that the cabinet secretary is familiar with the Balvenie, as it is made in his constituency. The whisky had a beautiful aroma and, as we nosed it, the Barcelonian—if that is what one calls someone from Barcelona—said that we have real treasures in Scotland. He was referring not only to whisky but to tweed that he had recently bought and to our wonderful food and scenery—things that are unique to Scotland and that give us our character. He said that we must maintain them at all cost if we want to maintain our distinctiveness from other parts of the world. What he said is central to today's debate. Everything that he mentioned comes from, or is dependent on, our land. We must protect with our lives the valuable, exclusive industry that is our agricultural industry.

I therefore welcome the CAP health check with its aim of modernising, simplifying and streamlining the CAP. The health check will help farmers to respond better to signals from the market and to face new challenges in 2009 and beyond. I particularly like the ability that it gives us to increase support for new entrants. However, the measure will be of little good on its own; we must also ensure that enough land is let to allow new entrants to get started.

There are many reasons for the distinctiveness of Scottish agriculture. Our land, climate, people and culture are what make it distinctive and all of them must be reflected in our policy decisions. Such decisions must be made to suit Scotland and the diversity that exists in our country. The DEFRA vision and its push for the phasing out of pillar 1 over the next few years do not suit Scotland's distinct needs. Whereas 20 per cent of agricultural land in England is classified as LFA, 85 per cent of land in Scotland is classified in that way. We should make no apology for using all the means at our disposal to support our agriculture. As Richard Lochhead pointed out not so long ago, the UK Government subsidises many things, including the nuclear industry by billions of pounds. Why then should it not subsidise an essential industry such as Scottish agriculture?

As I have said, Scotland is renowned as a food-producing nation. Indeed, the sector is worth £7.5 billion a year. In a nation with such distinctive products and abundant resources, it is essential not only that we protect those fundamental resources but that we encourage their development and use.

Highlands and Islands producers are a vital part of the food supply chain and make a significant economic and social contribution to the whole of Scotland. Indeed, it is estimated that in 2006 agriculture in the Highlands and Islands Enterprise area was worth £259 million out of a Scottish total of £720 million. In addition, the Highlands and Islands is where 36 per cent of all agricultural jobs in Scotland are to be found. Agriculture is relatively more important to the Highlands and Islands economy than it is to the Scottish economy as a whole; it accounts for 12.1 per cent of total employment in the Highlands and Islands as compared with 2.8 per cent in Scotland as a whole.

Photo of Jim Hume Jim Hume Liberal Democrat

Does the member accept that the figures for the Highlands and Islands are the same as those for the south of Scotland?

Photo of Dave Thompson Dave Thompson Scottish National Party

Yes, I accept that that is the situation. That area must also be well looked after.

It is therefore essential for the benefit of the country as a whole that we continue to encourage production in the Highlands and Islands—and the south of Scotland—through special policy incentives. We need to ensure that we do not hinder future development. There cannot be a one-size-fits-all policy and, when we move to area-based payments, there cannot be flat payments throughout the country. Also, we cannot phase out direct support from the public purse.

I welcome the cabinet secretary's commitment to a positive and collaborative vision of Scottish agriculture. His call for an updated contract between farming and society is precisely what is needed right now, as is an updated contract between Scotland, the rest of the UK and Europe, through further devolvement of both policy making and fiscal powers. Since 1999, we have been able to tailor our policy decisions to our needs, where we have responsibility. If we are to do the job properly, we need more responsibility. For example, we need to be able to preside over animal health policy, in order to protect the specific interests of our agriculture industry. We also need to be able fully to represent Scotland's interests at the negotiating table in Europe.

We are doing well as a devolved SNP Government and have shown that we can work well with others on the European stage. Nowhere has that been clearer than in relation to responsibilities in the rural affairs and environment portfolio. I hope that that will give those members who are a wee bit feart the encouragement and confidence to consider taking the next step to full nationhood.

Photo of Jamie McGrigor Jamie McGrigor Conservative 4:01 pm, 21st January 2009

I refer to my agricultural interests and memberships in the register of members' interests.

As my colleague John Scott indicated, the Scottish Conservatives share the view of the NFUS and most farmers in Scotland that the deal that has been achieved represents a generally fair outcome for Scottish farming; it is certainly better than many of us feared when we debated the issue last May. However, will the minister address Lantra's concern that there is now hardly any provision for supporting the training of youngsters in farming skills?

On modulation—or agricultural clawback tax, as I prefer to call it—I welcome the fact that the sliding scale of progressive modulation, which would have penalised our most efficient farms and food producers, has been dropped in favour of only one threshold. Overall, the proposals on compulsory modulation will mean that, as we move towards 2012, other EU member states will move towards our modulation levels, which will help to create a level playing field—if members will forgive the cliché. However, it is appalling that Scotland's rural development pillar 2 funding has dropped to £7 per hectare of utilised farm land per year, the lowest in the EU, while Austria's is £122. I accept that much of that discrepancy is down to history, but why on earth has more not been done over the past 15 years to lessen it?

I am pleased that we have avoided any moves towards dropping the historic basis for payments. The current single farm payment is the bedrock of support for farmers and crofters the length and breadth of Scotland and we should be extremely cautious about tampering with it. Modulation is fair only to those whose SRDP schemes are accepted—at least, that is how it seems to farmers and crofters.

Farmers have generally welcomed the fact that Scotland has received permission to continue the Scottish beef calf scheme until 2012. All of us are concerned about the fall in stock numbers, which is set out vividly in two recent reports, and the decline that we are witnessing in the remote and rural areas of my region of the Highlands and Islands. The retention of quality sheep and cattle in the marginal and remote areas of the country is crucial for the agriculture sector. Farmers and crofters in those areas supply the stock that is fattened and processed elsewhere in Scotland, which is important. There are real worries that critical mass is being lost. The SBCS has the potential to make a difference in supporting the beef sector. I would be interested to hear how the cabinet secretary sees the scheme developing between now and 2012.

I was pleased to take part in the meeting that was held on Monday this week in Oban to discuss the findings of the RSE report. Sadly, the mood of the farmers and crofters present was still gloomy; it had not been helped by the reaction of the Minister for Environment to my members' business debate last week on the bull hire scheme. I welcome Sarah Boyack's amendment, which calls for the scheme to continue, and was encouraged by the cabinet secretary's earlier remarks, if I heard him right. Ministers need to act with urgency and to do all that they can to restore confidence in the hill farming sector.

There are many positive and useful proposals in the reports of both the RSE and the Scottish Agricultural College, and I look to ministers to act imaginatively. For example, will they consider restoring grants for liming and slagging, to encourage tired pasture and to improve grazing in marginal areas? Can more support be given for bracken clearance, drainage and control of rushes—all measures that help to improve the quality of livestock?

In last May's debate on the CAP health check, I spoke about the Scottish Conservatives' complete opposition to compulsory electronic sheep tagging, and I make no apology for going back to that issue. Like my sheep farming and crofting constituents, I am deeply concerned that, despite efforts by the NFUS and others—including, I concede, the Scottish Government—the EU has decided to press ahead with compulsory electronic tagging from 1 January 2011. A constituent from Sutherland, who has been a sheep farmer for 45 years, wrote to me last week. She fears that electronic tagging will bring

"death to the industry"— and I do not think that she meant death from electrocution. She warned that, if the measure goes ahead,

"I will certainly get rid of my sheep and most likely the shepherd as well, and there are many more farmers with the same intentions."

What can the cabinet secretary say in response to my constituent and the rest of the sheep farming sector? Will he continue to try to persuade the EU to drop what NFUS has rightly referred to as a scheme that is

"impractical, costly and delivers nothing new in terms of traceability", and which the Aylward report into the EU sheep sector called

"ill thought out, illogical and unworkable"?

NFUS's current survey to determine the impact that electronic tagging will have on farmers' intentions to keep sheep in the future will, I am sure, provide further evidence as to why we need to fight a bureaucratic idea that shows no understanding of the actual circumstances of sheep farming in Scotland.

Before I conclude, I will emphasise the concerns of many farmers and growers about last week's EU vote on pesticides. If it is implemented, the pesticide ban will significantly reduce the ability of many of my constituents to grow healthy crops, and it could lead to significant production problems, which, in turn, would raise food prices. That is a serious matter.

The CAP health check deal that has been achieved should give our farming sector some hope that an appropriate support system will be in place between now and 2012. In addition, however, ministers must support hill farming in its hour of need and tackle the dreadful decline in livestock numbers in our hills.

I support the amendment in John Scott's name.

Photo of Irene Oldfather Irene Oldfather Labour 4:07 pm, 21st January 2009

At this point in the debate we can probably all agree that, if we were to start now with a blank sheet of paper, we would probably not devise the present CAP. The policy has been added to and changed on an incremental basis, as the CAP was set up in post-war Europe when there were six member states in the then European Economic Community. Today, we face new and different challenges in a European Union of 27 member states with widely varying farming practices.

Colleagues have spoken about the issues that are relevant today and that might be relevant 20 years down the line. They include global justice, which Elaine Murray spoke about, and food security, which John Scott and Sarah Boyack discussed. If we want to think about what kind of society we want to be and how the common agricultural policy could support that society, we might consider the EU budget reform process post 2013. I believe that that process provides us with an opportunity to consider such questions.

We must think carefully about what the policy objectives will be and about the means that will be used to deliver them. For example, should there be improved synergy between cohesion policy and CAP? In its opinion on the health check, the Committee of the Regions argued strongly for such linkages between funding strands to maximise the benefits to rural communities. It is early enough in the process, I believe, to influence the debate on budget reform and it is important that consideration and debate take place in the coming weeks and months.

In that context, it would be remiss of me not to mention that the Parliament's European and External Relations Committee intends to undertake an inquiry into EU budget reform post 2013. I hope that other committees will take an interest in the matter, and that they will submit evidence and get involved. As CAP accounts for 45 per cent of the EU budget, today's debate offers the Parliament an opportunity to comment on some of the new and long-term issues.

Part of the post-2013 discussion must be about added value and the opportunity that using joined-up resources could present. We must be clear that the discussion is about more than farming because it has become apparent that the food that we eat is, for example, one of the determining factors in our ability to avoid cancer, heart disease and stroke. The European Public Health Alliance has identified price and availability as the most significant determinants in food choice today.

For too long in Europe, we have not acknowledged the importance of joined-up policy development. Tobacco subsidies are an example of that. Despite what we know about the adverse effects of smoking on health and despite the introduction of policies for healthier lifestyles and smoking bans across Europe, we still subsidise tobacco growing. For many years, the European Union spent one billion euros a year on subsidising southern Mediterranean farmers to produce poor-quality tobacco for sale in the third world. Before researching for this speech, I thought that that was yesterday's problem because it was agreed that, between 2006 and 2010, the subsidies would be reformed and eventually eradicated. Of course, reform was agreed, but the democratic arm of EU government—the European Parliament—voted only a few weeks ago to continue subsidies through the present budgetary period to 2013. I think that members will agree that such a policy is inconsistent with promoting healthy lifestyles and tackling coronary heart disease.

The importance of policy objectives lining up with each other cannot be underestimated. According to the European Public Health Alliance, one can envisage a health-promoting CAP as one that would seek to support rural communities, reduce food poverty and global health inequalities, improve nutritional health and promote healthy, ethically sourced, quality food.

The latter point brings me to the question of animal welfare. I do not have time to go into the subject in detail, but suffice it to say that farmed-animal welfare is intended to occupy a central place in the CAP, according to the European Commission document "Report on a Community Action Plan on the Protection and Welfare of Animals 2006-2010". However, animal welfare was not identified as one of the new challenges in the health check. I recognise that cross-compliance has played a part, but changes still need to be made in specific statutory management requirements for animal welfare. I hope that, post 2013, those will form specific policy objectives. However, there is an opportunity in the short term to add, for example, the laying hens directive and the broiler chickens directive to the list. I would welcome an indication in the minister's summing up of whether he would support that proposal.

Photo of Jamie Stone Jamie Stone Liberal Democrat 4:13 pm, 21st January 2009

I will say a few words on the subject of the bull hire scheme. As some members will be aware, I was brought up on a dairy farm in the Highlands. I can remember my parents working extremely hard to improve our small stock of shorthorn dairy cows using the bull hire scheme—they had steady and continuous work over the years. However, it ultimately led to an improvement in the quality of the stock, which gave my family a better return in terms of more milk with a higher butterfat level. In the longer term, it made the business more viable, which was important.

We can see a fruition of the bull hire methodology in my constituency in the Mey Selections brand of products, which is spearheaded by the Prince of Wales, or the Duke of Rothesay, as he prefers to be known in Scotland. That brand is about marketing the finest-quality food products—meat and non-meat—to lucrative markets in other parts of the UK. Mey Selections would not work if we did not have the secure knowledge that the raw material was of the very highest quality. That is what the bull hire scheme is about.

With reference to quality, I want to name check, if members do not mind, the Albannach hotel in Lochinver, which has just won, as we were all delighted to read in yesterday's Press and Journal, a Michelin star. I think that it may be the furthest north establishment on the Scottish mainland to achieve a Michelin star. The Albannach hotel is all about purveying the highest-quality local food to its customers.

I notice that it was said in last Thursday's debate, which I did not take part in, that the bull hire scheme does not work. However, one man who knows more about the issue than most of us—I refer to Alan MacRae, who is the chairman of the North West Cattle Producers Association—has said:

"The financial savings of closing the scheme are small, but the wider detrimental effects inflicted against the government's stated policy objectives for rural areas could be great."

He knows what he is talking about.

Reference has been made to the scheme's cost, which is a relevant issue. I take members back to a great Labour man, Willie Ross, who was Secretary of State for Scotland under Labour Governments between 1964 and 1970 and between 1974 and 1976. He was an ardent supporter of Highland development. Very famously—in a quote that we should all know—he said:

"For 200 years the Highlander has been the man on Scotland's conscience".—[Official Report, House of Commons, 16 March 1965; Vol 708, c 1095.]

I do not support the notion that the Highlands should automatically receive subsidies, but a mark of a civilised society is that more well-off areas support areas that are more economically fragile, and other outlying areas to which members have referred. For that reason, the cost of the current bull hire scheme—or a future bull hire scheme—is surely justifiable on the ground that it improves the quality of the stock and thereby underpins the local economy. In doing so, the scheme also reduces the amount of public money that people require because it makes local industry more self-sufficient.

A second point, which was not touched on in last week's debate and has not been mentioned today, is that the use of cattle in the Highlands benefits the land. As Peter Peacock will recall, John Lister-Kaye, who lives in Inverness-shire, published a booklet in 1994 called "Ill Fares the Land", which makes a persuasive argument for using cattle on our not-such-good-quality land. I quote:

"Cattle were good for the soil. Their hooves and their wet dung, literally heaven-sent to the bugs and bacteria upon which the soil depends, together with their tearing and tugging mouth action, aerated the soil without damaging the heather nor close-cropping the grass. To what was left of the woods the removal of the cattle in the summer meant more tree regeneration and, more importantly, the development of a full summer crop of grasses, flowers and shrubs whose role it is in a forest ecosystem to bring nutrients and minerals, particularly scarce and precious calcium, to the surface".

In my experience, I know of no other writing about why cattle should be used on our uplands that puts the point more eloquently than that. Arguably, the bull hire scheme is beneficial not just to the local economies and people in those areas but to ecosystems as well.

Allowing the quality of livestock to deteriorate would indeed be thoroughly bad for the Highlands. However, in response to an intervention from Alasdair Allan, Richard Lochhead referred to proposals that his colleague Mike Russell will bring forward. That is to be welcomed. On behalf of my party—like other parties, I am sure—I can say that we would all be willing to work together on the issue. The bottom line is that we cannot simply present crofters and farmers with a replacement bull hire scheme that is either unworkable or unaffordable. The issue is too important to my constituents to allow that.

Photo of Alasdair Morgan Alasdair Morgan Scottish National Party

I am afraid that I will need to curtail the next two speakers to three minutes each.

Photo of Bill Wilson Bill Wilson Scottish National Party 4:18 pm, 21st January 2009

Large chunks of the developing world are being bought up by international businesses for massive farming enterprises. In the short term, that could produce a lot of cheap food, but the question arises: for whom? The multinational buy-up of farm land also threatens subsistence farmers in developing countries—

Photo of Bill Wilson Bill Wilson Scottish National Party

Sorry, I have only three minutes.

It also threatens their diverse traditional crops and animals, their unique local adaptations, all of which contribute to lending global agriculture resilience in the face of climate change. That loss of agricultural biodiversity and indigenous farming techniques might, in the face of global warming, prove a terrible threat to food security.

We cannot obtain food security by simply taking land from others. If we seek food security, food must be generated here at home. I do not suggest that we need to cease to import food, but the expropriation of the land of underdeveloped nations will not bring security, nor is it moral.

In assisting our own Scottish farmers to provide food, we must also have regard to what might appear, at first consideration, to be imperatives other than security: biodiversity; the need to limit climate change; and the need to mitigate such change. All three of those are, of course, inseparable. We cannot ignore the threat of climate change, the need both to reduce our greenhouse gas emissions and to mitigate their effects. In both, the role of biodiversity is vital—for example, locking carbon into our soils and retaining biological options for the future.

Biodiversity has been fostered by our farmers, particularly those who practise extensive grazing in less favoured areas. Because 85 per cent of Scotland is classified as less favoured, I agree with the Scottish Government that the first pillar, which supports the least favoured areas, should not be phased out in the next few years, but I also agree with Scottish Environment LINK that LFASS should be reformed to include meaningful eligibility criteria that better target payments towards farming that has a high nature value. I urge the Government to examine Scottish Environment LINK's proposal that a new livestock envelope be set up with the aim of protecting the grazing systems that are important to biodiversity. Given the rapid livestock reductions that have occurred recently, those systems are under threat. Supporting farmers to manage extensive grazing systems is important from several points of view. There are synergies between low-input meat production and the production of meat that is better for health, the promotion of biodiversity, and animal welfare.

On biodiversity, Butterfly Conservation Scotland states that the ideal habitat for the threatened marsh fritillary butterfly is best achieved through light grazing, ideally by cattle. Furthermore, here is a headline from The Guardian of 5 November 2007: "Loss of cattle farming hits corncrake comeback." The article goes on to say:

"Stuart Housden, director of RSPB Scotland, said: 'The corncrake and many other important species are very much dependent on extensive cattle rearing practices that characterise much of the Highlands and Islands. If we are to see this wildlife flourish funding streams like the less favoured areas support scheme and rural stewardship scheme must be ... retained and targeted'".

We need farmers to build our food security. If we do not lend them essential support, many of our small farmers might be unable to continue, which would destroy our hopes for improved food security and many of our fragile rural communities. At the same time, however, we cannot afford to fail to ask our farmers, in return for Scottish and European funding, to—

Photo of Alasdair Morgan Alasdair Morgan Scottish National Party

I am afraid that the member's time is up.

Photo of Peter Peacock Peter Peacock Labour 4:21 pm, 21st January 2009

I will try to make four points in the three minutes that I have. The first is that, although little compulsory change is required of Scotland because of the CAP health check, there are opportunities for greater flexibility. There are two aspects to that. First, we all recognise that the historic payments are increasingly unsustainable and unjustifiable, and there is an opportunity to move to a more area-based system. That would allow some funding to be moved from less commodity-productive areas such as the north-west Highlands and parts of the south of Scotland.

Secondly, there are opportunities in relation to the national envelope. I have urged the Government to be imaginative in using the flexibility that it has, creating new means to target the preservation of grading systems and thereby keeping cattle and sheep in the high nature value areas of the countryside.

I will move on briskly. Another issue that arises is the loss of set aside, which is presenting challenges. Set-aside was created under the common agricultural policy to stop overproduction, but it had the side benefit of creating habitats for biodiversity. It created great habitats for wild flowers, which in turn are good for honey-bees, bumble-bees, butterflies, ladybirds and myriad other invertebrates. I am sorry that the minister for the spineless is not here today after he launched the invertebrate strategy yesterday. I hope that he is still out there standing up for the spineless in Scotland. I support the Government's initiative because those invertebrates are hugely important. They pollinate huge areas of plant life and support a diverse bird population. The RSPB magazine this month reports on the loss of farmland birds in large numbers. In addition, beekeepers throughout Scotland have reported difficulties with honey production because of the loss of habitat and set-aside where they can put their beehives. That is an economic factor for them, but there are other concerns about bee populations and the loss of set-aside is adding to and compounding the problems.

We need to maintain as much habitat as possible, but, as John Scott said, we must do that while maintaining food security and increasing food production. That is why we support John Scott's amendment. We need support programmes to ensure that farmers can sustain habitats at their field margins by creating hedgerows and using unproductive corners of fields. I call on the Government to be imaginative in creating programmes that allow ameliorating measures that help biodiversity and species such as the invertebrates, which, like the Government, I am happy to stand up for.

Photo of Alasdair Morgan Alasdair Morgan Scottish National Party

I thank members for their co-operation.

Photo of Robin Harper Robin Harper Green 4:24 pm, 21st January 2009

This has been an extremely interesting debate, in which some good points have been made. I enjoyed Sarah Boyack's speech and was particularly impressed by her remarks about milk. When milk prices are lower than bottled water prices, something is seriously wrong in our economy.

Sarah Boyack and many other members talked about food security. In my view, one of the best ways of guaranteeing food security in this country is to guarantee the health of our soils and the health of our population. One way of doing that and simultaneously reducing costs is to reduce artificial inputs of all kinds. If we reduce the use of nitrogenous fertiliser and of pesticides, fungicides and herbicides, we will reduce costs. Similarly, if we reduce the energy that must be employed to apply pesticides and other methods of control to crops, we will reduce costs. That will increase food security, because fuel costs will go up, so the more highly mechanised our farming is, the more subject it will be to the threat of high fuel prices, about which we in the Parliament have heard farmers complain many times over the past decade.

All that my amendment asks is that Parliament accept the European Parliament's decision that new controls

"need to be placed on the use of agricultural chemicals" and note that

"once these new controls are implemented there will be a level playing field in Europe".

The UK MEPs are already halfway there, because last year they agreed almost unanimously—only 12 votes were cast against the directive, most of them by members of the United Kingdom Independence Party—that member states must adopt national action plans for reducing the risks and impacts of pesticide use on human health and the environment, including timetables and targets for use reduction. I simply ask members to approve something that has already been approved and, consequentially, to indicate that they are also behind the regulatory proposals.

I will detail how rational, sensible and light touch those proposals are. Only 22 out of 311 pesticides are being considered for banning. If a substance is needed to combat a serious danger to plant health, it may be approved for up to five years, even if it does not meet the safety criteria. Provision is made for the banning of highly toxic chemicals that are

"carcinogenic, mutagenic or toxic to reproduction, those which are endocrine-disrupting, and those which are persistent, bioaccumulative and toxic ... or very persistent and very bioaccumulative".

In my view, that is not much to ask the Government and Parliament to approve.

In between the vote on the directive and the vote on the regulations, something happened to the UK MEPs.

Photo of Robin Harper Robin Harper Green

I cut short my earlier speech by half a minute, so I will not take any interventions in the two minutes that I have left; I am sorry.

The UK MEPs were lobbied by the chemical and farming industries. The European Parliament has been accused of overreacting, but when an MEP states that the country's entire carrot production would come to a halt as a result of the measures in question, that is certainly a case of exaggeration. There are several large organic carrot farms in Scotland that are doing very well, thank you.

We want a dynamic and competitive farming industry. If a level playing field is achieved through the CAP, we believe that our farming industry will remain as dynamic and competitive as it is now—especially because of some of the extra encouragements that the Government is offering.

In the near future, I hope that Parliament and the Government will start to engage creatively with the proposal—

Photo of Alasdair Morgan Alasdair Morgan Scottish National Party

I am sorry, but the member's time is up.

Photo of Jim Hume Jim Hume Liberal Democrat 4:30 pm, 21st January 2009

I declare a farming interest and my two past directorships of NFU Scotland.

An aim of the common agricultural policy was to provide farmers with a reasonable standard of living, and many members have acknowledged that point this afternoon. Other aims were to give consumers quality food at fair prices, and to preserve our rural heritage. The policy has evolved to meet the changing needs of society. As a result, food security, the environment, value for money and fuel crops have become key factors.

Today's debate has been interesting. Again, we have heard Mr Lochhead take all the praise for anything good that has come from the Scottish rural development programme, while Rob Gibson says that anything wrong with the programme is the fault of the previous Administration.

CAP reform under Ross Finnie gave farmers greater freedom to decide which crops to produce. That was hailed as a great success, unlike the English reform, which embraced area payments. Under our reform, farmers—instead of having to produce certain products to obtain support—were able to choose what to produce so that they could match the demands of the market. Furthermore, it was at last acknowledged that farmers who received CAP support had responsibilities towards the protection of the environment and towards public health and welfare. Scotland has a good track record in such issues, as Mr Lochhead acknowledged.

John Scott mentioned a level playing field for farmers that will ensure sustainable food production. Production will run alongside the stewardship of our land so that our biodiversity is retained and nurtured. We cannot have environmental benefits without economic activity on the ground to deliver them. I believe that Sarah Boyack acknowledged that point.

When we debated this issue last May, two things became clear from our discussions with the farming sector. First, any increases in compulsory modulation should be tempered by reductions in voluntary modulation, and secondly, progressive modulation—as mentioned by Jamie McGrigor—threatened to damage the farming sector, stifle business and unfairly put Scotland at a competitive disadvantage compared with other parts of Europe. Luckily, those issues have been addressed, we hope.

As many members have acknowledged, we are moving from an era of food surplus to an era of food shortage. The imbalance between the farm-gate price and the retail price has been acutely felt by producers; it does not bode well for a viable future. We obviously have some great hills to climb, if members will forgive the pun.

If any of our aspirations for a food policy are to be met, the Government's top priority must be to secure our future production capacity. The SRDP will be a key part of that, as will support for farming activity and efforts to stem the decline in livestock numbers.

I am a bit surprised that John Scott will not support the Liberal Democrat amendment, because there are real problems with access to the Scottish rural development programme, as my colleague Liam McArthur has illustrated. The system is too complicated and farmers are being put off from even applying. The criteria are restrictive, and we have heard that 25 per cent of all applications are given the red light. The Government must address that problem.

Another problem arises, as Liam McArthur pointed out, because the system is computerised. Because of digital exclusion, it is not always possible for people in remote, rural areas to apply. That may not be the case in Ayr, but it certainly is the case in other parts of the south of Scotland if broadband is not available.

A cost is involved in the use of consultants, which gives rise to the fear that an unsuccessful application will also have an added cost. That can be enough to put people off applying.

I could not mention consultants without—like Sarah Boyack—mentioning FWAG Scotland, which faces an uncertain future. I know that Mike Russell met the organisation yesterday. I urge him, and the cabinet secretary, to do all in their power—and it is in their power—to help FWAG Scotland to survive in a meaningful way after April and into the future. The industry and conservationists need FWAG Scotland's expertise.

Photo of Jim Hume Jim Hume Liberal Democrat

I am sorry, but I have to make progress. If the minister could refer to it in his winding-up speech, that would be helpful.

Alasdair Allan and the two Jamies mentioned the bull hire scheme and the benefits to the economy that it brings.

I am glad that Dave Thompson recognises that the south of Scotland, too, needs special assistance, being of high hills, et cetera. That view is in slight disagreement with the SNP deputy leader of Argyll and Bute Council, who said that SRDP funding should be taken away from Aberdeenshire, Berwickshire, Dumfries and Wigtownshire and given to the Argyll area.

As the cabinet secretary has acknowledged, Scotland has distinct agricultural needs that must be taken into account by the CAP health check, particularly in terms of on-going support for the livestock sectors and rural and remote areas. If we are to see livestock on our hills, we need CAP support to make up the gap between the market price and what is needed to make such farming viable.

I welcome the review of the SRDP, which, in close dialogue with the industry and other interest groups, will be key to the delivery of a more market-responsive and sustainable agricultural industry through an improved SRDP. I look for support across the benches for the Lib Dem amendment.

Photo of Nanette Milne Nanette Milne Conservative 4:36 pm, 21st January 2009

Looking back over what was said here in May, ahead of the Government's consultation on the CAP health check, I think that it is fair to say that most of the issues that are of concern to members have been dealt with to our satisfaction in the deal that was struck in Brussels on 20 November. The Scottish Government and the farming community have welcomed the agreement as largely positive. However, as members across the chamber have said, many challenges lie ahead in its implementation. We have been pleased to contribute to this afternoon's interesting and mainly consensual discussion, and we look forward to supporting the Government's motion—and, as John Scott said, the Labour amendment—at decision time. We particularly agree with the remarks of Sarah Boyack and others about the need for a bull hire scheme.

In the present-day world, where financial threats to national economies and a growing concern about food security increasingly occupy our minds, it is essential that the CAP operates to ensure that we have a sustainable and competitive agricultural industry, giving farmers the opportunity to play a full part in the expansion of our economy and to contribute to food security through efficient and profitable food production. At the same time, however, we must not forget the importance of Scotland's biodiversity and its contribution to our heritage and very important tourism industry, which is dependent on our land managers being able to function in a manner that sustains and enhances our environment. As we know, that has been under threat recently, as sheep have disappeared in large numbers from our upland and remote areas. The number of cattle, too, has been significantly reduced, and there is a growing threat to our biodiversity from ungrazed and unmanaged land because the animals are no longer there.

Increasing food shortages are becoming a global problem. It is becoming increasingly important for farmers to focus on their central role of food production and for Government to ensure that they get the maximum support and encouragement to increase their productivity to satisfy an expanding world market as it tries to meet the ever-rising demand for western-style food. The Conservatives believe that, in the current climate, if the CAP is to be about anything it must be about increasing production in our agricultural industry. We are reasonably happy that the CAP health check has taken into account most of the issues that we raised in our response to the Government's consultation on the future implementation of the common agricultural policy in Scotland.

The move towards a more level EU-wide playing field on modulation has been mentioned by several members. Action is being taken to avoid progressive modulation, which would have led to cuts in the subsidies to larger farms and would thereby have disadvantaged Scotland, which has a higher proportion of large farms than continental Europe. In addition, Scotland is being given the freedom to decide how best to proceed with the beef calf scheme, which may be retained until at least 2012, to the benefit of beef production in the most fragile parts of Scotland. All that is very welcome to us.

We also welcome the retention, at this point, of the historic model of payment of the SFP. We feel that a purely area-based system would not be appropriate for Scotland, because the land quality varies so much throughout the country. Any move away from the historic model would, in our opinion, have to take account of the large land-quality variations. However, we think that the subsidy should be paid only if the land in question is being actively farmed. I hope that the cabinet secretary agrees with that.

We have long advocated the removal of the outdated milk quota system, and we are pleased that that will at last be achieved in a few years' time. We have advocated strongly the abolition of set-aside, because of our concerns about food security, and we are happy that that has now been completed. However, we recognise the need to preserve our biodiversity and environment. As John Scott said in response to its consultation, the Government must put in place schemes that will ensure that no detrimental environmental impact results from the removal of set-aside. That could be done via the provision of a new cross-compliance option for the establishment and/or retention of habitats, as suggested by some of the conservation bodies. In the meantime, the existing cross-compliance requirement to leave buffer strips and retain landscape features will help to make up for the loss of at least some set-aside land.

The key issue, as Peter Peacock stressed, is how to actively manage farmed land in a way that enhances biodiversity while increasing production. That is a major challenge for all concerned, be they farmers, politicians or conservation organisations, and it must be at the heart of any cross-compliance reforms.

In the meantime, we are anxious that when ministers look again at the current SRDP, they do so with a view to refocusing the spend of pillar 2 resources on food security and livestock retention. That would go some way towards addressing the substantial decline in livestock on our hills, which has been documented by the recent excellent reports from the RSE, the SAC and NFU Scotland, and it would help to answer the case that was made by the Scottish Conservatives in our food security task force support, which asks the Government to pay special attention to finding ways of boosting the less favoured area support scheme, following the loss of substantial numbers of Scotland's hill sheep.

We are broadly content with the outcome of the CAP health check, but we have concerns about food security and we hope that the Scottish Government will consider refocusing the rural development funds towards schemes that will support it, particularly with regard to the retention of livestock in remote and upland areas. Our farmers must be given every encouragement to maximise their contribution to our economic growth, through food production, and to the environment, through their capable management of our outstanding rural landscape.

Photo of Rhoda Grant Rhoda Grant Labour 4:42 pm, 21st January 2009

Today's interesting debate has given Parliament the opportunity to consider what needs to be done to support our land managers, and to give a broad welcome to the outcome of the health check.

Irene Oldfather highlighted some of the real problems with the CAP, which demonstrate that the health check is not a needless instrument. Indeed, her speech starkly highlighted the damage that the policy can do and the need to continue with the process of reform. As she said, if we started with a blank sheet, we would come up with a very different system.

We need to ensure that the needs of our fragile areas are properly represented and taken into account. There is always a fine balance to be struck with regard to our policies, due to the interdependency of the farming industry in Scotland. However, the cabinet secretary referred to a windfall of payments that was available as a result of the exchange rate. A good way of using those windfall payments would be to find a way of rebalancing the system in favour of our more fragile areas. For example, the less favoured area support scheme does not fully compensate for the challenges of farming and crofting in the worst land, which is also often remote from markets.

Crofting and farming in those areas are essential for the sustainability of communities. We need to ensure that people who work in those areas are supported and that we provide them with a level playing field. Liam McArthur and Peter Peacock talked about balancing the distribution of the money that is available so that it benefits the fragile areas, and suggested ways in which that process could proceed.

We need to retain the bull hire scheme. I was interested in the cabinet secretary's response to Alasdair Allan, but what he was saying was not clear to me. Rob Gibson, too, mentioned the matter but he obviously had a greater understanding of what the cabinet secretary was proposing.

The arguments for the bull hire scheme were well made during Jamie McGrigor's members' business debate last week. I spoke to officials when I was in Brussels yesterday, and it is clear that the de minimis system allows for the scheme to continue. It is not clear, however, how the scheme could be provided under different support systems, so I am interested to hear what the minister has to say on that. To be clear, our motion calls for a bull hire scheme, not for assistance with bull transportation or shelter, and certainly not for advice on how one would hire a bull from a private network.

We need to recognise the importance of globalisation in farming, and the impact of the CAP on developing countries. I am interested to know what the SNP Government's policies are on that and how seriously it takes its global responsibilities. We need food production, but we also need global fairness, as Elaine Murray highlighted. I doubt whether any member would disagree that it is often other EU countries that are the main offenders in dumping cheap food on developing countries to the detriment of their farming industries, but we need to take our responsibilities as part of the EU seriously and deal with the problem.

The Liberal Democrats' amendment notes a concern about the SRDP. John Scott said that that concern was out of date, but I am not so sure of that, because we have no terms of reference for the review. Access to the scheme is no easier, so we need to take action and press for the review to come forward. A large number of my constituents cannot make online applications as they do not have broadband.

We need to consider stocking levels; that ties in with the bull hire scheme. It is important to decide how we support people who farm in remote and rural areas, as sheep numbers have fallen, to the detriment of our environment. We need to ensure that single farm payments are tied to active farming—we do not want sleeper farmers. Imagine how it would feel to work and farm next door to people who were getting the same amount of support for doing nothing. There is no public or environmental benefit in that, so we need to tackle the problem before it is too late. Without schemes such as the bull hire scheme, the problems that affect sheep stock numbers will affect cattle stock numbers, but in a way that is much worse and which will have a much greater environmental impact.

We need to take our environmental problems seriously. My colleague Sarah Boyack made clear that it is not a issue of food production versus the environment—the two things have to work hand in hand. We can increase food production in an environmentally responsible way. Bill Wilson spoke about health and the environment, and how environmentally friendly policies delivered healthier food and biodiversity. Those things can work hand in hand, and it is important that they do so. Climate change will be caused if we do not look after our environment, and that affects developing countries disproportionately. In considering our duty towards our neighbours, we need to think about how we provide environmental benefit when we farm our land.

Many members have spoken about food security, and the Conservatives' amendment deals with the issue. We are concerned about food security, and our Westminster colleagues have made clear that it is a top priority. Again, it is not about a conflict with environmental protection—the two go hand in hand. We need to learn from other countries how to do that, and we need to ensure that we have food security. We need to ensure that food is provided locally; members have spoken about importing foreign produce and the effect on climate change of transporting food around the world. We need to consider local procurement in our public services, and to think about sourcing products as locally as possible.

The sentiments that Robin Harper expresses in his amendment are correct—the controls that have been implemented in Europe will have to be implemented here, under European law. However, his amendment does not deal with the concerns that have been expressed on that issue, and it is therefore not balanced. Robin Harper is right that we should be concerned about health, not only for the benefit of our food production but because we must take seriously the concerns of our farmers and crofters who work with pesticides. We must also protect the environment—in particular, bees.

We must ensure that fragile areas are protected and we must create a level playing field for them. Not only does the SRDP enhance the disparities, but it delivers a scheme that is accessible only online, which immediately disfranchises people who do not have broadband. The Government is failing people twice: first by not providing them with broadband and, secondly, by disfranchising them. We must ensure that what we offer is compatible with our environment. Our farmers and crofters are used to working with nature and must be involved.

Photo of Richard Lochhead Richard Lochhead Scottish National Party 4:50 pm, 21st January 2009

The debate has been a good one. I am sure that our farmers and crofting communities will take great heart from the fact that more seems to unite us than divide us on the future of Scottish agriculture—it has been a very good debate in that context.

Rightly, the debate has largely been about the future of Scottish agriculture. First and foremost, it has been about the future of our rural communities, of our farmers and crofters, of food production in Scotland, of the environment and of our rural economy.

I will start with the SRDP, because many members spoke about its future. I was intrigued that, as ever, a lot of criticism came from the Liberal Democrats and Labour members, who appear to have forgotten that, in large part, they designed the programme that they now criticise.

I will make a couple of key points about the SRDP before I talk about the review. First, much of the criticism was about one of the eight mechanisms within the SRDP. It is important that across the chamber we recognise and send out to Scotland the message that the SRDP, at £1.6 billion, is a big programme. It has eight delivery mechanisms and does not consist of only the rural priorities mechanism. That has led to some issues, which I will talk about shortly.

One of the eight mechanisms is the LFASS, which has been a success. Our money is out in record time—£60 million has gone out the door. Within the rural priorities mechanism, to which many members referred, £57.2 million has been committed in the nine months since it opened. The third mechanism, land manager options, has provided £19 million for legacy schemes and there has been £4.5 million of new commitments. So far, £12 million has been committed to food businesses throughout Scotland through the food processing, marketing and co-operation grant scheme, which is another mechanism that I am sure we all welcome at this point in the economic downturn. In this financial year, £2.5 million has been spent through the crofting counties agricultural grant scheme; £700,000 has been committed through the skills development scheme; and £2 million has already been paid through the LEADER programme, and a further £4 million committed. The first forestry challenge funds projects are up for approval in February, although there have been some obstacles due to European regulations.

I am trying to convey to the other parties that the SRDP is a major programme and that, given that many of the mechanisms are working fine, we should not put people from across Scotland off applying.

Photo of Liam McArthur Liam McArthur Liberal Democrat

I accept that the cabinet secretary inherited, to a large extent, the programme that he is taking forward. However, the arguments that he is trying to posit would be more convincing if he was not the last person to acknowledge the problems in the implementation phase of the rural priorities mechanism.

Photo of Richard Lochhead Richard Lochhead Scottish National Party

I have said all along that I take seriously the concerns expressed by the small minority of farmers and crofters who have difficulty due to the online application process for the rural priorities mechanism. I take slight issue with the Liberal Democrat amendment, because it is perhaps just a wee bit over the top and sends out the wrong message about the whole programme. Even within the rural priorities element, substantial funds are going out the door.

We have taken some steps over the past few months to try to make it easier for people to apply under the rural priorities mechanism. Case officers have been instructed to find solutions for the small number of applicants who have difficulty with the online process. We are actively looking at how we can streamline the process even more, and a user group of stakeholders has been set up to help us do that.

We are a year into the programme, and we acknowledge that it is time for a review, for three reasons. First, we should learn lessons from the first year. Secondly, we must ensure that this massive programme, which addresses the future of rural Scotland, reflects our priorities in 2009 and beyond, given the changing global agenda. Thirdly, at a time of economic downturn in Scotland, we want to ensure that the resource is leading to economic activity in our rural communities.

The future of the crofting communities has been discussed, and the bull hire scheme has, of course, featured in many members' speeches, including those of Jamie Stone, Rob Gibson, Jamie McGrigor and Sarah Boyack. We must accept that the current bull hire scheme does not give value for money. We must also take into account the fact that only a few hundred crofters, out of around 13,000, have received any advantage from it. However, I can give a commitment that the Scottish Government—

Photo of Richard Lochhead Richard Lochhead Scottish National Party

I would like to finish my point. I can give a commitment that the Scottish Government is willing to meet all parties in the very near future to consider the success of our arrangements. We recognise that concerns exist and we want to deliver a good deal for Scotland's crofting communities. The current set-up, which does not give value for money, must change. We want to put in place better arrangements, and we will speak to members about that.

Photo of Richard Lochhead Richard Lochhead Scottish National Party

I would like to move on to the next subject, if the member does not mind. I have only four or five minutes left.

We have discussed future food security and climate change. A key message that the Scottish Government wants to convey is that food production should remain the primary purpose of Scottish agriculture—although not its only purpose. Members of the public expect farming and agriculture in Scotland to deliver food for their tables, so that should be the primary purpose of those sectors. However, it is important that we say that that is not their only purpose, as sustaining our rural communities and safeguarding and enhancing our environment are other public benefits that they produce. We must ensure that we get a range of benefits from agricultural activity in Scotland that is in line with the outcomes that the nation wants.

It is important to farmers to have a clear message about what is expected of them. This debate has also been largely about the CAP health check. During the debates in Europe, each country fought for its own interests, as one would expect, but I was disappointed that that did not happen in any policy context. The issues were not food security or climate change; rather, each country was out to get what it could from the health check. We must send a clear message to the agricultural sector in Scotland about what we expect from it, and all the debates—in Europe and in Scotland—should take place in that context.

I was interested in what Dave Thompson said. He highlighted how agriculture in Scotland underpins other sectors. Our food and drink sector, including the whisky industry, depends on raw materials, of course. Whisky is the UK's biggest food and drink export, and farming activity in Scotland underpins that important industry.

We all agree that we have tough decisions to take in 2009 not only on the future of the SRDP, but on the LFASS and single farm payments.

Several members said, rightly, that such direct support should go only to active farmers. The Scottish Government totally agrees with them and with the industry. We should not give single farm payments to armchair farmers; we should give them only to active farmers who are delivering benefits to the people of Scotland.

That said, we should keep the matter in perspective. Only a tiny minority of the recipients of single farm payments are not active farmers. The message that we want to send out to Scotland is that the majority of crofters and farmers in Scotland deliver public benefits, although we must tackle the minority who are not active but who receive money.

Labour's amendment calls on the Scottish Government

"to work constructively with UK ministers" on behalf of Scotland. We have been doing that with a great deal of success and we will continue to do so. When I attended the Oxford farming conference at the beginning of the year, I got a fantastic reception not only from the small Scottish delegation, but from the delegation from south of the border, because our agricultural policy is closer to what many farmers south of the border want. We must recognise that Scotland has distinctive needs and characteristics that deserve distinctive agricultural policies.

Sarah Boyack is right. Hilary Benn and the UK Government are talking up food production—but they are also talking down direct support for it. We cannot have it both ways: if we want food production to continue in Scotland, direct support must continue.

Photo of Sarah Boyack Sarah Boyack Labour

We have not heard anything about what the SNP Government thinks about the global justice point—I refer to subsidies to other European countries—that colleagues across the chamber have made. This is not just about Scotland; it is about the rest of Europe as well.

Photo of Richard Lochhead Richard Lochhead Scottish National Party

Of course that is a key issue. It was a key issue during the CAP health check discussions, and it should always be a key issue when we consider the common agricultural policy. Of course we want tobacco subsidies to end. That is an important issue—I think that Elaine Murray mentioned it—and there are other issues on which Scotland makes its voice heard. However, we believe that there is a case for direct support in Scotland, to try to stem the decline in Scotland's hill and more remote communities in particular. The UK policy position is different from Scotland's policy position and, I think, from that of most parties that are represented in the chamber.

There are many key challenges ahead. We must tackle the decline in the number of livestock in Scotland's hills and remote communities. That decline is not new—it continued throughout most of the eight years during which the Labour and Lib Dem Administration was in power.

One headline in today's press is "Farming far from gloomy". The article refers to a survey by Lloyds TSB, in which

"83% of respondents said that their farm businesses were profitable and 62% said that their pre-tax profit exceeded their private drawings."

Scottish farming has a bright outlook. We have huge grounds for optimism. In taking the decisions that lie ahead, we must ensure that Scottish agriculture continues to deliver huge benefits for Scotland and to put food on our tables and on tables elsewhere in the world, as well as safeguarding and enhancing Scotland's precious environment and sustaining our rural economy. In short, we must ensure that Scottish agriculture helps to make Scotland a great place in which to live. I commend the Government's motion to the Parliament.